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First Steps: Manufacturers Embark on Path to Digitization

Manufacturing is an incredibly diverse industry, ranging from discreet and process to pharma, medical devices, and the extremely high tech world of nano-manufacturing. Regardless of the type, manufacturing as a whole is quickly becoming the backbone of digital era. It has the ability to bring a new world of connected devices and robotics to reality, along with associated programming, web, and wireless technologies. In a sense, these technologies have been part of manufacturing from the days of CNC and the automation of various shop-floor components.

But at present, many manufacturers are struggling to bring their operations into the digital age. The truth is, traditional manufacturers cannot make the leap to digitalization until they have fully embraced the previous era of IT, meaning integrated supply chain software, e-commerce, and web.

Here are a few things manufacturing CIOs need to ask themselves:

Have I realized full benefits of my ERP implementation? More than 50% of organizations I’ve worked with have more than one version of ERP, and it is not optimized upgraded, integrated, or connected to other business applications or enabled on mobile devices.

Am I capturing and converting data? To take advantage of the terabytes of data you generate every day, you must have sophisticated data-to-information capabilities and be able to use connected devices to convert the data into actionable information.

What is the state of my supply chain? Your supply chain and inventory must be optimized to create true client satisfaction. Ask whether or not the investment you made to implement software to streamline your demand- fulfillment processes has paid off.

Do I have a fully optimized enterprise architecture? Take a hard look at number of applications you have in your organization, which are still relevant to the business, and which are ready to be retired, re-platformed, or reengineered.

Will my infrastructure support a plunge into digitization? Specifically, is your data center SOC1/SSAE16 and SCO2 compliant? Is it optimized to perform well on engineered systems such as HANA and Oracle Engineered Appliances?

Have I integrated and streamlined my business processes? When implementing any new system that supports a business process, the hardest part is designing it to work with both today’s systems and future applications.

To evaluate where you are in the move toward digitization, look at the following:

Have you considered moving your ERP and applications to the cloud, or are you still worried about security of your data and comfortable keeping server boxes nearby?

Have you start getting your daily reports on your mobile devices, or must you log in to the desktop machine in your office even to approve a purchase order?

Have you considered data mining, unstructured data analysis, and predictive modeling?

Are you still suspicious about social media to the point where you don’t have Facebook, Twitter and LinkedIn account?

Have you users adopted SaaS applications and solution like SFDC for CRM, Success Factor for HR, Ariba for procurement to just name a few.

Is your sales force needs to invest time in office to get customer related data or to manage deal life cycle or even to file cumbersome expense reports . Are they really productive with your client in the field or sytem and process are pulling them down?

How many devices at your workplace are smart devices that could be integrated with your current system applications and can also be accessed via mobile phone?

If you’re still firmly entrenched in the server/desktop world, are unfamiliar with the power of today’s data analysis tools, and not fully immersed in social media, you’re just starting down the path toward digitization. Here are some steps you can take to speed up the journey:

Take a stock of your apps, data, and infrastructure and benchmark them and your IT budget against others in your industry.

Conduct a thorough application portfolio/rationalization exercise to provide insights into current business usage and possible adoptability of new technologies.

Review ways to reduce the duplicity of various software vendor licenses and better leverage your current applications and hardware.

Set a goal to have robust cloud strategy and migration plan in place within the next two years (one year is better).

Understand the value of analytics (structured and unstructured) by conducting various proof of concept experiments.

Begin using social media to understand what your customers are talking about.

Begin automating business processes that don’t require human intervention, allowing ERP to directly communicate with other systems such as CRM and procurement.

Gain is impossible without risk, and since there are so many stakeholders involved, I recommend a cautious approach. It’s a good idea to begin by creating a business case and to use funding from your discretionary budget. Start with one or two low-budget proof-of-concept projects that use new but proven technologies enabling social media, mobility, cloud, and/or analytics pertaining to areas such as artificial intelligence, machine learning, and IoT. Rather than attempting all of these at once, pick an area suitable for your business needs, and enjoy the journey.